Position Paper on Commission’s Proposal for Services Directive

11 March 2005 – AER POSITION PAPER ON THE EUROPEAN COMMISSION’S PROPOSAL FOR A DIRECTIVE ON SERVICES IN THE INTERNAL MARKET (COM2004) 2 final/3

The Association of European Radios (AER) is a Europe-wide trade-body of private and commercial radio broadcasters in France, Germany, Italy, the UK, Greece, Spain, Portugal, the Netherlands, Denmark, Finland, Sweden, Switzerland and Romania. As such, AER represents the interests of over 4.500 radio operators, of all shapes and sizes, broadcasting to millions of listeners across Europe every day.

INTRODUCTION

The proposed draft Directive on Services in the Internal Market was published by the European Commission at the beginning of 2004 as part of the process of economic reform intended to make the EU the most competitive and dynamic knowledge-based economy in the world. As stated in the draft proposal, the “objective of this legislation is to provide a legal framework that will eliminate the obstacles to the freedom of establishment for service providers and the free movement of services between the Member States, giving both the providers and recipients of services, the legal certainty they need in order to exercise these two fundamental freedoms enshrined in the Treaty”.

Although AER is in general agreement with these objectives, the Directive as it stands today is a source of major concern to private and commercial radio broadcasters. Because of the great diversity of the commercial radio landscape in Europe, there is tremendous uncertainty as to the long-term consequences on existing national licensing frameworks and on future developments in the industry, in particular with regard to the migration from analogue to digital radio.

Because of the lack of comprehensive and comparable radio data available at European level, today, the possible effects of European regulatory initiatives on this sector such as this draft Directive are largely unknown. In this context and with crucial technological challenges ahead of us, a large majority of private and commercial radio associations thus strongly oppose inclusion of radio services into the Directive arguing that the long-term consequences of its implementation could fundamentally alter in unwelcome ways the radio broadcasting landscape in Europe.

The case of Europe’s private and commercial radios

Exclusion of radio broadcasting services from the Services Directive

Private and commercial radio broadcasting in Europe today is a hugely diverse industry. European citizens have greatly benefited from the liberalization which took place in the sector over the years with thousands of radio stations now operating in the EU and offering a large choice of music, entertainment and information to millions of listeners across the EU.

While radio stations come in all shapes and sizes – large national operators, local, regional and/or networked radio stations, trans-border and/or solely local – the large majority are medium-sized businesses (SMEs) broadcasting locally or regionally to often well-established and faithful audiences. The national licensing frameworks in place reflect this diversity and are well suited to the specificities of radio broadcasting and to the cultural, technical, social and demographic realities in each of the 25 EU Member States.

Private and commercial radio broadcasters are concerned that this Directive will profoundly alter Member States’ prerogatives in terms of regulating the sector in particular in terms of licensing.

The sector is evolving towards digital broadcasting and Radio as we know it is at the brink of its second “revolution”. The process is highly complex and might take place over a very long period of time. It will have a huge impact on listeners, broadcasters and advertisers as well as on spectrum management and allocation, licensing and regulatory frameworks. The draft Directive contains provisions on authorisations (ban on automatic renewal of licences) which could simply jeopardize the migration to digital.

The imminence and complexity of this “second revolution”, the diversity of the sectorthe specificity of radio as a popular mass-communication medium and the fact that radio – whether commercial or public – offers services of general economic interest and is licensed at national or local level, makes radio different from other media. This makes the implications of the Directive on this industry difficult to assess. In AER’s view, the inclusion of radio services into the scope of the Directive will be counter-productive for a large majority of local and regional radio stations across the EU and for the future development of the industry.

CONCLUSION

AER understands the need for appropriate Community instruments to continue building the Internal Market but – as far as the Services Directive is concerned – suggests that for the radio broadcasting sector the potential draw-backs be weighed against the perceived advantages especially at a time of migration to digital.

A large majority of the European private and commercial radio broadcasters are deeply concerned about the unprecedented impact this piece of legislation could have on licensing frameworks in many European countries.

AER thus asks that this sector be excluded from the scope of the Directive.

ENDS
11/03/2005

NOTES: Brussels-based AER (the Association of European Radios) represents the interests of 14 national private and commercial radio associations in 11 EU Member States, Switzerland and Romania. The combined membership is of over 4,500 private/commercial radio stations broadcasting to millions of daily listeners across Europe. Our web site provides further information on the association. www.aereurope.org

Brussels-based AER (the Association of European Radios) represents the interests of 14 national private and commercial radio associations in 11 EU Member States, Switzerland and Romania. The combined membership is of over 4,500 private/commercial radio stations broadcasting to millions of daily listeners across Europe. Our web site provides further information on the association. www.aereurope.org